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  • #1

    Son in Laws tax problem

    My SIL is self employed and has got behind with his tax payments. He has now had a letter from the tax office and part of it states

    "If you do not pay or contact us we will take further action to force you to pay. "We could visit your home to view your possessions and arrange for them to be sold at public auction, as the law allows"

    Does the law in fact allow HRMC to do this without going to court first?

    The amount owed is around 4K and he is paying monthly what he can afford but not enough to clear this bill in time before the next payment will be due in July.

    A second option according to their letter is to pass it on to a debt collector but I was not sure what powers the HMRC have as regards their threat to visit and view possessions.
    Tags: accounts, act, action, advice, april, bailiffs, bank, bank accounts, bankruptcy, bill, con, county, court, criminal, debt, enforcement, family, hmrc, household, illegal, interest, law, letter, money, mps, payments, phone, poor, power, powers, raid, tax, threat
  • #2
    Re: Son in Laws tax problem

    Couple of things here.

    HMRC like all tax due, to be paid within the same tax year, if the monthly repayments mean it wont be settled till after the same tax year to which it relates, then they aint happy and like to get heavy.

    All your SIL can do, is continue to pay what she can afford, and reduce the liability.

    If it happen to go to court she has shown she has been trying to clear it and in all probability, the judge would award the same amount each month as a repayment. HMRC can send people round, but they still have to follow the process for reposesion, which means obtaining a writ, and your SIL would be given a chance to defend that prior to being issued.

    That's how I understand it anyway, someone else may know better.

    In regards to the July payment. July payments are effectively 1/2 estimates of the tax due for the following year.

    I will assume for the moment your SIL's accounts run up to the 5th of April every year. My advice is to quickly seek her accountant, or obtain one if she doesn't have one. And have this years accounts (6th april 2013 - 5th april 2014) submitted.

    If she can show, that the tax due for this year, is LESS than the 1/2 estimates due Jan 14 and Jul 14. Then an accountant will submit a form SA302 to reduce the july payment to zero.

    This will give your SIL more time to repay the tax due.

    Hope that's helped.
    I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

    If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

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    • #3
      Re: Son in Laws tax problem

      http://taxaid.org.uk/guides/tax-debt/enforcement-action

      There is very little risk of criminal prosecution or imprisonment. Some people fear that failure to pay tax on time may leap to criminal prosecution and imprisonment. In fact, this is rare. HM Revenue and Customs does prosecute a small number of people every year, but all cases involve allegations of serious dishonesty or evasion. HMRC does not normally take such action just because someone has not paid their tax on time, or has difficulty finding the money to settle.

      It is important to know what DMB will do if you refuse to seek an agreement, or cannot reach an agreement.
      In such circumstances, DMB will consider taking enforcement action, which will be one of the following measures:

      • Legally taking possession of goods for sale at public auction (formerly known as distraint),
      • Summary Proceedings in the Magistrates’ Court (or Sheriff Court in Scotland),
      • County Court proceedings,
      • Bankruptcy.

      Legally taking possession of goods is a process formerly called “Distraint”, whereby HM Revenue and Customs may take some of your possessions for sale at auction towards settlement of an unpaid tax bill. HMRC has the legal power to do this without any court order.

      Threats of distraint or legally taking possession of goods should not be ignored, but it may be reassuring to know that:

      • the first visit may be from a member of HMRC’s “Field Force”, local staff whose initial function is to check the debtor’s address, and make face-to- face contact with them, so as to see if matters can be sorted out without resorting to enforcement
      • the HMRC officer should act within the law, and you need not fear the illegal behaviour that is sometimes reported of bailiffs who carry out the process for other debts
      • the HMRC officer cannot force his way into your premises without a court order, and such orders are very unusual

      HMRC may consider legally taking possession of goods which you consider to be ‘tools of the trade’; particuarly if you have no other assets. Vehicles can be particularly at risk. The fact that HMRC can do this without a court order means that all threats of distraint should be taken very seriously.

      If you do not agree that you owe the tax demanded, or believe it is a lot less, you should tell the HMRC officer, but you will find that he is in a non-negotiable position once he is in your home.

      What should you do?


      Some people are very frightened by the thought of an HM Revenue and Customs officer turning up at their home and taking possession of their goods.
      If so, the first thing is to ensure that you have done everything possible to pay the tax or reach an agreement with HMRC. But in some cases it is not possible to obtain an agreement.

      If you are upset at the thought of the HMRC officer turning up at your home, you might be able to persuade him that such a visit would be pointless because you have no assets worth seizing, perhaps by offering a list of the main items that you own. If so, you should explain this to the HMRC officer and tell him you would prefer to deal with this on the phone, or come to see him at his office instead. If he will not agree to this, and makes a visit to your home, you do not have to discuss the debt with him there and have the right to deny him entry.

      You may be worried because you have a family member who suffers from poor health or stress, who might be very upset by such a visit. If so, you should explain this to the HMRC officer and ask him to visit at a time when that family member is expected to be out. He should normally agree, and it is a good idea then to write a letter to him confirming what has been agreed.

      Points to note:

      • HMRC does not normally take such action for debts below £100
      • there are some goods that are protected from such action, in particular basic household goods and anything that is jointly owned with someone else.

      Further guidance

      On the HMRC website

      Technical guidance on distrainthttp://www.hmrc.gov.uk/manuals/dmbmanual/DMBM655000.htm
      Enforcement factsheets http://www.hmrc.gov.uk/leaflets/c14.htm
      I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

      If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

      Comment

      • #4
        Re: Son in Laws tax problem

        ok so they have the power to repossess without a court order, however I still think this is unlikely given your SIL is making some payments albeit not ones that they have agreed.

        HMRC do like to spout hot air, they will even tell you to sell your TV to pay the tax. Still keep paying what you can afford, and take my advice on the July payment ASAP.
        I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

        If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

        Comment

        • #5
          Re: Son in Laws tax problem

          Thanks Guys,

          I will pass the messages on. Much appreciated.

          Comment

          • #6
            Re: Son in Laws tax problem

            This may be of interest to him -----> HMRC powers to raid bank accounts 'could be illegal', MPs told
            I'm an official AAD Moderator and also a volunteer, here to help make the forum run smoothly. Any views or opinions are mine and not the official line of AAD. Similarly, any advice I have offered you is done so on an informal basis, without prejudice or liability. If in doubt seek advice from a qualified insured professional - Find a Solicitor or go to the National Probono Centre.

            If you spot an abusive or libellous post then please report it by Clicking Here. If you need to contact me, for instance if I've issued you a warning, moved, edited or deleted your post, please send me a message by clicking my username.

            Comment

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